Hardwood suppliers have announced multiple price increases on select solid and engineered hardwood products — nearly 20 percent over the last year. While these increases will have far-reaching implications for the industry at large, the retail community is preparing for the impact on the selling floor. They said that these increases have the potential to alter consumer spending.

Jeff Shipe, owner of At Your Door Floor Store in Derwood, Md., said that these price increases have prompted some consumers to turn to big box stores for purchasing wood flooring. “Homeowners are taking a better look at stores like Lumber Liquidators and Home Depot. For those who have been shopping for 6 or 12 months, they believe these price increases are a sales ploy. Once they go out, do their research and realize that it is in fact industry-wide, they do follow through with the purchase. But, this is one more obstacle that we now have to overcome,” he said, adding, “We’re finding that we have to re-fix prices on any job proposal that is older than two weeks.”

Don Herndon, owner of Classic Wood Flooring in Rockledge, Fla., said that while he’s been able to raise retail prices slightly and still remain competitive, parts of his business that are feeling the effects significantly.

“Where these increases are hurting us is the builder market. We can’t raise prices on the construction end. We’ve had to turn to alternative products,” he said.

Creating market shifts

Retailers said that not only are consumers looking to other flooring types, the price increases will increase the sale of engineered floors because they are able to control its price better.

Ron Goins, floorcovering manager of Woods Lumber Co. in Independence, Kan., said his store already tends to sell more engineered than solid but the recent price hikes may increase those sales as well as push customers to look to products of a lower quality. Wood flooring is a luxury product, and with the additional price increase customers may choose to go with lower cost products,” he said.

Greg Kemp of Kemp’s Flooring in Huntsville, Ala., agreed. “More customers will turn to engineered hardwood, value grade hardwood and LVT. Some may even decide to stay with carpet. Also, some consumers may go to unfinished hardwood because of the cost of prefinished,” he said.

Shipe, who is located in the Metro D.C. / Maryland area, said this region sells predominately solid hardwood products. “I don’t think there will be a significant spike in the sale of engineered floors,” he explained. “Even if there’s a $2 per square foot difference between products, the consumer, at least around here, will stick to the traditional, 3/4 inch solid floor.”

Imported and exotic species are also becoming more popular because they are not experiencing the same price pressures as domestically produced products, noted Herndon of Classic Wood Flooring.

“Customers are still price conscious and these increases are making other products look more attractive. We’re also seeing a little shift in weight from handscrape to smoother, wire brushed products. Since those products are machine-finished they’re not as labor intensive as the handscraped floors,” he said.

Testing consumer confidence

While consumers remain cautious with spending, all signs point to a rebounding flooring market. Wood sales in 2012 experienced a 7.2 percent increase in dollar sales, according to Catalina Research. Although numbers aren’t close to pre-recession numbers, retailers said, despite the increases, 2013 is shaping up to be a good year.

Shipe, who noted that his business is up close to 30 percent so far this year, said that he is seeing an increase in the dollar amount of job tickets partly because consumers are doing their research before coming into the store.

“I would say we’re up by 15 to 20 percent as an average, total ticket per job,” he said.

Herndon, too, has also noticed a consumer trend in turning towards quality product.

“It’s not as hard to sell quality as it was even in the past nine months. Consumers are still price conscious but willing to err towards the side of quality and upgraded products. People aren’t shying away from $10 wood,” said Herndon.

However, Shipe warned that the whole industry has to work together in order to prevent the market from getting inundated with low priced, low quality wood products similar to what happened in the laminate category.

“As long as we don’t buy low quality product from manufactures that are flooding the market with low priced products they won’t try selling it,” noted Shipe.

Goins of Woods Lumber Co. added that although price increases are never easy, it is imperative for retailers to highlight all of the benefits of hardwood floors, especially now.

“We as retailers will have to work harder to show the value in wood flooring due to the price increases,” said Goins.